BBC Blocked From Creating Web-Based Local Video Services

By Kevin Hilton

SVG Europe editor

The BBC has been blocked from creating a new web-based local video
service to carry sports and news coverage. The broadcaster’s overseeing
body, the BBC Trust, decided that the proposal for a network of
websites across the UK would not improve the public offering enough to
validate spending licence fee money and would have an adverse effect on
commercial broadcasters and local newspapers.

BBC management had
proposed news, sports and weather services to work alongside those
already offered by its national and regional television and local radio
channels, plus the associated websites. This would have involved local
portals in 60 areas around the UK, with five services in the Welsh
language, all run by for 400 staff working with a budget of £68 million
over a four-year period.

The BBC Trust’s decision was reached
after it carried out a public value assessment (PVA) in parallel with a
market impact assessment (MIA) conducted by the UK broadcast regulator,
Ofcom. The MIA concluded that the proposed BBC local video service
would have a “significant negative market impact on commercial
providers”, including commercial TV and radio broadcasters, local
newspapers and their websites.

Ofcom said that even without
competition from a new BBC local video service, existing online news
sites are struggling to bring in advertising money. Its report added,
“Our main concerns are about the effect of the BBC proposals on future
commercial innovation in online local news, sports and weather
services.”

In a statement the BBC Trust said there were
“increased financial pressures on the BBC” and that a new video service
would not “create significant new reach or impact” to justify spending
licence fee money. The Trust’s chairman, Sir Michael Lyons, commented,
“We believe the BBC’s priority should be improving the quality of
existing services. The public wants better quality regional television
news programmes… [but] this proposal is unlikely to achieve what they
want. We would expect BBC management to consider carefully the
conclusions of this public value test before returning to us with new
proposals.”